EUROFER: Chinese steel imports confuse buyers in Europe

Chinese steel producers exploit the export tax regime

Steel supplied on the EU market by European steel producers complies with the European regulations and standards. “Steel made in Europe means reliability in trade, stability of properties during processing and safety in the use of the material”, EUROFER Director Axel Eggert says.

This is not guaranteed in the case of Chinese steel imported in the EU, notably imports of wire rod, rebar and bar, as well as hot-rolled coil and heavy plate.

The Chinese government promotes exports of alloyed steels with tax rebates of 9 to 13 percent on the general export tax of 17 percent. To get the most tax-beneficial classification as alloyed steels, Chinese steel producers add cheap alloy boron agent to steels specified by the customer as non-alloy qualities. Although the boron quantities are up to twice as high as permitted, Chinese steels are marketed in the EU as unalloyed steels.

Boron in steel improves the uniformity of the hardness of the steel. But if weld ability and elasticity are required, typically for unalloyed steel, a higher share of boron can be particularly harmful including welding cracks.

China’s steel exports are estimated to reach at least 85 million tonnes this year, up by 43 percent year-on-year. Chinese exports of steel products in which boron is typically added represent more than 50 percent of the total Chinese export volume.

“Not only does China promote exports of its excess steel production by targeted product tax advantages, but Chinese steel qualities also confuse the markets as Chinese producers exploit the export tax regime. The EU market surveillance authorities are now required to eliminate the risk of misleading use of the CE mark,” EUROFER Director General Axel Eggert says, “Steel processors must be protected from being exposed to wrongfully declared qualities to the risk of serious economic disadvantages.”

EUROFER, the European Steel Association, represents 100 percent of EU steel production. The European steel industry plays a vital role in many of Europe’s strategic supply chains. With steel made in EU we combine a turnover of approximately €166 billion – a share of 1.3 percent in the EU’s GDP. At more than 500 steel production and processing sites in 24 EU member states we provide direct employment for 335 thousand people and indirect employment for millions of European citizens.